Back in April 2017, Evanston voters overwhelmingly passed a referendum intended to cover growing deficits projected into the mid-2020s for Evanston/Skokie School District 65
But, as the last few years have shown, that referendum has not ended up filling the bill, with the district running three straight budget deficits that the referendum was supposed to prevent.
Two superintendents later, with an outside financial consultant hired to help keep the district’s finances on track and more than $13 million in personnel and program cuts made to balance the budget going forward, 12 candidates are running to fill four open positions on the school board that the incumbents have chosen not to vie for again.
As voters go to the polls, the RoundTable has compiled a detailed recap of the events and decisions that have shaped District 65’s finances in the eight years since the referendum.
Overwhelming ‘Yes’ vote
Near the start of the 2016-17 school year, District 65 projected a $73,000 surplus for that fiscal year but foresaw deficits rising as high as $12.6 million by 2020-21, and growing from there.
On April 4, 2017, voters in Evanston Township, concerned about reductions in the number of teachers, growing class sizes and potential cuts to popular programming like band and orchestra for fourth and fifth graders, approved the referendum by a wide margin, which allowed District 65 to increase its property tax levy by about $14.5 million per year, adjusted upward for inflation.
In an editorial supporting the referendum, the RoundTable cited three reasons for backing the tax increase: operating deficits projected to grow from $5.1 million in fiscal year 2018 (ending June 30 of that year) to $24.4 million in fiscal year 2025; the $15.2 million it would provide for the district’s many needed capital projects; and the possibility at the time (with former Gov. Bruce Rauner and former House Speaker Michael Madigan locked in a budget battle royale) that the State of Illinois might make steep cuts in funding or freeze property taxes.
“We recognize the referendum is asking the community for a lot. But we think it is essential for our children, our schools, and our community,” the editorial stated. Among other changes, the failure to pass the referendum could have resulted in cuts of 50 to 60 staff positions, increases in class sizes and cuts in programs and services, such as aides for the Two-Way Immersion program, in addition to elementary school band and orchestra.
More than 80% of voters went along, despite the average 5.8% increase in the school-focused portions of their property tax bills, putting District 65, then led by former Superintendent Paul Goren, in a position to balance its operating budget, maintain educational programs and move forward with capital projects during the subsequent eight years.
Resolution and guidelines
The board subsequently approved a resolution and guidelines on how to use the $135.6 million in additional funds that would be generated over the eight years hence, as well as how it would report on the use of those funds. The resolution noted that without the additional property tax revenue, the district would be facing a cumulative budget deficit reaching $112 million by fiscal year 2025.
“It is the steadfast intention of the Board to use all of the additional money generated from an increase in the PTELL limiting rate [based on the state’s Property Tax Extension Limitation Law] for the purpose of eliminating the projected budget deficits without diminishing the District’s fund balances,” the resolution read.
As envisioned by the referendum plan, the district would be able to build up surplus during the first four years (through 2020-21) to use those surpluses to balance the budget for the next four. The referendum was not designed to end the structural deficit so much as buy time to address the cumulative projected deficit if nothing was done in the meantime.
The referendum provided an additional $14.5 million in funding for the first year, with slightly higher amounts for subsequent years based on the inflation rate, or consumer price index (CPI). Based on an average CPI increase of 2.5%, this would mean 20% more by the end of the eight-year period; and given inflation in the post-pandemic period, significantly more, continuing the benefit of the referendum beyond the eight years.
Then school board President Candance Chow said at the time: “This is a commitment we made on how we’re going to spend the $14.5 million. We should have a resolution on this. I feel it’s critical for this board to make this commitment.”
The referendum guidelines set forth other uses for the funds, including at least $500,000 per year for district-wide capital improvements, maintaining the district’s fund balance with contributions of at least $1 million per year, allowing the district to discontinue funding short life-cycle technology equipment with long-term capital debt and supporting strategies to bring both 1-to-1 instructional technology at middle schools and literacy interventions for struggling students, including one full-time reading specialist at each elementary school.
A second provision of the guidelines stated that the district’s annual budget documents would include a “referendum deficit management” line that would specify the amount of funds still earmarked toward balancing future deficits through at least fiscal year 2025, as well as an estimate of how long these funds would keep the district free of deficits.
Surplus and low turnout elections
By April 2018, the district was projecting a $6.2 million surplus for fiscal year 2019, $1 million of which would be used to boost the fund balance and another $5 million set in reserve for future operating deficits, based on the commitment made under the referendum plan to put surpluses from fiscal years 2018-21 aside to balance projected operating deficits in fiscal years 2022-25.
With all that set in motion, the school board elections held in April 2019 had the lowest turnout of any in the past decade, at 8.68% of voters participating, with incumbents Anya Tanyavutti (who went on to serve as board president), Sergio Hernandez (current board president) and Rebecca Mendoza all running unopposed. In August, the board appointed Biz Lindsay-Ryan to fill a vacancy left by Lindsay Cohen; and the following April (2020), the board appointed Soo La Kim to fill a vacancy left by Chow.
In a five-year plan adopted near the end of Goren’s tenure, the district prioritized restorative practices, monitoring goals to improve student achievement and boosting teacher professional development, among other provisions. Goren resigned from his post in June 2019.
That September of 2019, the school board approved a budget with a projected surplus of about $5.5 million; and the district once again allocated $1 million to the cash fund balance and the remainder to the referendum reserve to balance projected operating deficits in the coming years.
Horton era begins amid pandemic
In December 2019, during a school year in which two interim co-superintendents led the district, the school board, after a closed-door process, announced Devon Horton as the permanent replacement for Goren. Horton was then serving as chief of schools for the Jefferson County Public School system in Louisville, Kentucky. He had taught middle school in Chicago for 10 years before moving into building administration, first in East St. Louis and then in Louisville.
Then-board President Suni Kartha praised Horton for his commitment to educational equity and achieving increases in standardized test scores along with reductions in suspensions, particularly for students of color, when he was in East St. Louis and Louisville. His district-wide racial equity policy — the likes of which became considerably more common across the country after the May 2020 police murder of George Floyd — called for prioritizing restorative practices and setting and monitoring equity-based goals, while spearheading teacher development and retention work, and establishing a district-wide student data dashboard.
“District 65 is a special place. Typically, the term I would say, ‘disruptive innovation,’ is what you’ll hear in the tech world,” said Horton, citing the shift from Blockbuster to Netflix as an example. “I look at District 65 in a very similar format. As I listen to conversations and the statements made by the community and particularly the miraculous students and the passion that they have, this does not happen in many places.”
On March 13, 2020, Evanston public schools announced they would be closing for at least a month due to COVID-19.
By May, Kartha warned that schools might remain closed into the following school year, or there might be staggered attendance. “It is highly unlikely it’s going to look like a regular year,” she said. And Raphael Obafemi, the district’s chief financial officer, said, “COVID-19 has done a number on our finances. There’s going to be a significant impact to our revenues, as well as the expenditures of District 65.”
Nonetheless, the district closed out fiscal year 2020 with a $7.1 million surplus, about $1.6 million more than expected, and for fiscal year 2021, Business Manager Kathy Zalewski reported a projected surplus of nearly $500,000. For fiscal year 2021, the district initially projected revenues would be $3.5 million lower due to the pandemic, and a RoundTable analysis showed District 65 appeared to be putting less into referendum reserves than initially contemplated as part of the referendum plan.
Schools remained closed through the fall semester. On Dec. 11, Horton posted a letter to the community that said, “I can assure you that our goal remains to get students back for in-person learning as soon as it is safe to do so.” Another letter that Horton sent on Dec. 19 showed an expected surplus for fiscal year 2022, but deficits growing each year after that until they reached $12.4 million by fiscal year 2026; Finance Committee members considered about $10 million in cuts to achieve balance by 2024-25.
“Considering decreased enrollment and new financial reality, the District will try to eliminate the structural deficit by reducing its footprint and substantially reduce operating expenses,” Zalewski wrote in a memo in January 2021. “Unfortunately, before this financial stability is achieved, difficult conversations with the community and difficult decisions will have to take place.”
In-person learning resumed in staggered phases on Feb. 16, 2021, nearly a year after the initial closings, when the district rolled out a hybrid learning model that stayed in place for the remainder of the school year.
Higher voter turnout and Fifth Ward school
In March 2021, District 65 received approximately $10.6 million in federal aid from the America Rescue Plan Act (ARPA), to be disbursed over the following three years for goals like high-impact tutoring, social and emotional learning, community partnerships, interim assessments intended for diagnostic purposes and bridge/transition support aimed to boost enrollment in both early childhood programs and higher education. The district used the ARPA money to fund programs like the since-abandoned CREATE65 teacher residency.
Around that same time, the school board approved a fiscal year 2022 budget with $1.9 million in cuts. These included replacing 22 reading specialists with 18 “interventionists,” reducing bus transportation costs by switching the middle-school start time from 8:30 a.m. to 8 a.m. and pairing bus routes, and finding efficiencies and negotiating better prices to cut building and ground maintenance expenditures.
In the April 2021 school board elections, which saw significantly higher turnout than the 2019 vote at 23.31%, incumbents Lindsay-Ryan, Kim, Joey Hailpern and newcomer Donna Wang Su defeated four other challengers. In June, Marquise Weatherspoon was appointed to fill the opening left by Mendoza’s resignation shortly after the election.
At the end of the 2021-22 school year, District 65 reported a surplus of about $675,000, more than twice what it had projected at the beginning of fiscal year 2022, and it projected a surplus of slightly more than $200,000 for fiscal year 2023.
In March 2022, the school board unanimously approved the construction of a Fifth Ward school, later named Foster School after the building shuttered in the community more than a half-century earlier, and announced plans to close the building that housed the Dr. Bessie Rhodes School of Global Studies, but fold Rhodes into the new school.
On May 16, in a letter to the community, Horton said the cost of the school would be an estimated $40 million, and that the district would pay $3.2 million annually over 20 years — funded through savings in busing costs under a to-be-developed attendance map redrawn to create more walkable school zones.
The school would be financed using what Horton termed a “miraculous” funding model, a mechanism called lease certificates used for new buildings. These do not require a voter referendum to be approved because they do not require a tax hike, meaning that to issue them to pay for a building, you have to fund that building with savings.
“Ordinarily, when you issue your traditional bonds, what you do is you use property taxes to pay for that, especially tax assessment that then goes to the taxpayer,” Obafemi told the RoundTable, as part of a primer on lease certificates published in December 2022. “With a lease certificate, we actually are paying it back with operational savings from transportation cost.”
Also in March, the district announced it would be cutting 22 homeroom teaching positions to balance the fiscal year 2023 budget, in part to account for the City of Evanston’s decision that the district should pay the costs for crossing guards at an estimated $600,000 per year.
In the April 2023 school board elections, which saw turnout dip to 18.91%, newcomer Omar Salem won a seat alongside incumbents Hernandez and Mya Wilkins, who had been appointed in fall 2022 to replace the recently resigned Tanyavutti, who left after six years. This occurred two months after Tracy Olasimbo was appointed to replace the recently resigned Weatherspoon.
Horton leaves, spending dissected
In May 2023, the district estimated that its buildings needed approximately $189 million in repairs by 2030, with little ability to pay for them other than through another voter referendum. Shortly thereafter, Horton left the district to become superintendent in DeKalb County, Georgia, replaced by assistant superintendent Angel Turner, who spent a year as interim before being hired permanently.
“Despite beginning my chapter in District 65 during one of the most challenging periods in public education, I am deeply proud of all that we have accomplished,” Horton wrote in an email to families. “I believe we have made great strides in furthering educational outcomes for all students by strengthening academic supports and interventions.”
Horton made a last public appearance as superintendent for the dedication of the Fifth Ward School, held June 20, 2023, when he posed with a plaque that read, “This land is dedicated in honor and recognition of this community and its unwavering commitment to return a walkable neighborhood school to the Fifth Ward. Dr. Devon Horton, Superintendent. Every Child, Every Day, Whatever It Takes.”
It was around this time, as first reported by local Substack reporter Tom Hayden, that Horton used a District 65 credit card to pay for more than $20,000 in moving expenses, which included charges made in Georgia after his District 65 employment ended. He later paid back $12,634.94 for what the district determined were unauthorized expenses.
Horton also agreed to pay the district $700 per month to reimburse the nearly $25,000 because of ending his contract early. He quickly defaulted on those payments, but the board allowed him to pay a one-time late fee of $2,084.
Unexpected deficits and cost overruns
In August 2023, District 65 reported that its budget deficit had unexpectedly swollen to nearly $7.5 million for fiscal year 2023, after projecting a surplus of about $500,000 at the start of the 2022-23 school year. Student transportation costs ($3.7 million over budget) and purchased services ($3.4 million) were the largest drivers, along with facility repairs ($1.1 million) and textbooks for a new curriculum ($1.3 million).
“Going over the way we’ve been going over doesn’t add up,” said Hailpern, Finance Committee chair. “It doesn’t add up to me, so I think it’s worth us taking a closer look, as we go forward, earlier in the year.”
By June 2023, the district’s referendum reserve had fallen to about $30.5 million, still $10.9 million more than originally expected in 2017. However, at that time, the RoundTable noted several factors that had contributed $26.8 million to this windfall: an assumption that the district would incur a total of $6.6 million in teacher pension costs that the state legislature planned to shift to school districts but never did; property tax revenues that ran $11.8 million more than projected in 2018 due to factors like a higher CPI and/or a greater amount than expected from new property (not subject to tax caps); and a total of $8.4 million more than expected from Corporate Personal Property Replacement tax revenues.
By the start of the 2023-24 school year, the district was projecting an operating deficit of $2.5 million in fiscal year 2025, growing to $17.2 million by fiscal year 2029. Zalewski cited higher transportation costs, especially the use of taxi services, as well as the higher inflation of the previous couple of years.
“This assumes we do nothing,” said Obafemi, who left shortly thereafter, on Aug. 31, 2023, to take the CFO role at Oswego Community Unit School District 308. “We will definitely recalibrate and make the reductions that we need to make to make sure we deliver balanced budgets.”
In October 2023, the school board received the news that the Fifth Ward school as initially planned, projected to cost $40 million, instead would cost approximately $65 million — and that the projected annual transportation savings, originally estimated at $3.2 million by Horton and Obafemi and intended to cover the annual lease certificate payments in full, would instead be $750,000. That meant the remainder would need to come from operating costs for the next 20 years, such as out of the education fund.
“I’m disappointed,” Salem said. “I’m sad that these numbers were so off. I’ve only been on the board since May. … I remember being told very specifically the numbers. Dr. Turner, I’m not blaming you by any means, but I just feel cheated.”
The board subsequently voted to downsize the school to K-5 to bring it down to about $48 million in costs, $8 million more than initially planned but closer to the original budget. The board then decided to close Bessie Rhodes entirely since the plan for the “school within a school” at the new Foster School would no longer be able to include its entire K-8 grade-span, leading to furor and protests.
Financial consultant and budget cuts
In February 2024, district financial consultant Robert Grossi, hired in September 2023, told the school board’s Finance Committee that the district would need to make between $5 million and $6 million worth of permanent expenditure cuts in the next budget or risk an overall budget deficit of $47 million in the succeeding five years — bringing its fund balances to zero, with a projected seven days’ worth of “rainy day” reserves.
In addition to record high inflation rates during the previous three years, boosting costs beyond what property tax rates had anticipated, the main factors were enormous increases in transportation costs — which rose to about $10 million for fiscal year 2023, after having never been more than $6 million — and declining enrollment, with 1,600 fewer students than in 2018 but 200 more staff, Grossi said.
“There’s been a lot of growth in the budget. We have to look at what’s caused that growth,” he said. “Some of that stuff’s controllable. Some of that stuff’s not controllable. And I think that the $5 million to $6 million hopefully would be a doable number.”
The following month, Turner presented a budget plan that would right-size staffing levels to better match enrollment, create operational efficiencies by “reimagining” some non-teaching roles and responsibilities, and curb the growth of non-personnel expenditures.
“It is the goal of this administration and of our school board to change the district’s financial trajectory once and for all,” Turner said. “Our team has taken the charge to make significant financial reductions with the utmost seriousness and care. Budget reductions are always painful, and yet at this time, they are necessary.”
The board appointed Turner as permanent superintendent, praising her for her financial transparency over the previous several months.
“We heard from more than 600 community members through a survey and focus groups about the qualities they wanted in District 65’s next superintendent: chief among them, financial acumen, equity understanding, leadership in retaining the best and brightest educators and an individual who is transparent and collaborative,” Hernandez said. “An internal interview panel of school and district staff, union leaders and administrators overwhelmingly agreed that Dr. Turner truly embodied those qualities among the finalists.”
Based on the Illinois State Board of Education’s “Report Card” data from the end of the 2022-23 school year, the RoundTable reported in March 2024 that District 65’s enrollment drop of 20.5% during the previous five years was the highest among a cohort of 13 other similar Cook County districts. The district also had the highest per-pupil spending, highest average teacher salary, second-highest average administrator salary, lowest student-to-teacher ratio and, by a significant amount, the lowest student-to-administrator ratio among its peers.
The official groundbreaking on Foster School took place last July, 57 years after the closure of its namesake school, and the board later approved both the name and the Phoenix mascot. “I’m most excited about a school in the Fifth Ward for all these young people behind us. Just so y’all know, this is going to be your school,” said Fifth Ward Councilmember Bobby Burns. “They’re young enough to where they’re going to be part of the first class that attends this school.”
Later that month, District 65 got another unpleasant financial surprise: the district had closed out the 2024 fiscal year with a $10 million budget deficit, mostly due to “variance” in the transportation and education line items, Turner wrote in a message to the community. Yet the the board had approved a budget with a $276,000 surplus the previous September. A RoundTable analysis showed that the bulk of the “variance” did result from from cost overruns in the transportation and special education funds.
By the start of the current school year, District 65 was forecasting a total deficit of nearly $20 million for FY 2025 — including a nearly $8 million shortfall in operating funds and $10 million in bonds and capital projects — after unexpectedly accumulating a combined $20 million in deficits over the two prior years.
“Underperforming a budget in this manner for two consecutive years is unique based on all of my experience,” Grossi said. He found it “most troubling” that the school board “seemed to have been regularly provided with information that understated the financial impact of the major financial decisions they were asked to support.”
He added: “This is evidenced by two poorly developed budgets, inaccurate information of the financial implication in the construction of the new school, monthly financial reports that reflected data that were more than two months old, and financial reporting that positively skewed the District’s financial condition through techniques that included delaying the payment of bills and accelerating the receipt of grant revenues into the District before the associated expenses actually occurred.”
A RoundTable analysis in October showed that the district had a budgeted deficit of $13 million for fiscal year 2025, accounting for all funds except for capital projects.
Shortly thereafter, Grossi urged the board in a written memo to consider pausing the Fifth Ward school project “until the financial condition of the District is stabilized.” He also wrote that “the District does not have the financial resources necessary at this time to continue with the construction” of Foster School.
Nevertheless, in October 2024, the board reiterated its commitment to building the school.
“We have received a number of questions from our community about the school and whether it makes financial sense,” Hernandez said. “The construction of Foster School is not the reason for the district’s structural deficit or the financial challenges we face. It’s not an either/or situation, as some in the community may have suggested. The district has had a structural deficit for years, and while efforts have been made to solve it, the reality is that more has to be done, and significant reductions are required regardless.”
The board approved $23.4 million worth of construction contracts for Foster School in December, including packages for structural steel, electrical, heating and cooling, plumbing, fire suppression, windows and roofing. That same month, the board approved a new four-year contract with the District 65 Educators’ Council, with a 2.3% base pay raise — about the level of inflation — for all four years. With “step” increases as teachers move up in the ranks, that will come out to raises of 3.2% to nearly 7% depending on experience.
A RoundTable analysis of student achievement published in November 2024 showed that, while the percentage of District 65 students who met expectations in English Language Arts had jumped 8.4% on the 2024 Illinois Assessment of Readiness — the highest gain ever in the district — only 54% of students were prepared for the next grade level and likely to be on track for college and career readiness.
For math, there was a more modest 1.3% increase, and 43% of students met expectations. Overall, students had recouped some of the pandemic-induced “learning loss,” but achievement gaps remained between different groups of students, and lower percentages of eighth-graders than third-graders met expectations in math, suggesting they had lost ground overall in the previous five years.
Back from the brink
In January 2025, CFO Tamara Mitchell, hired last July, said District 65 would run out of money by sometime in fiscal year 2027 if it didn’t make major spending reductions, and suggested cutting at least $13.2 million from the 2026 fiscal year budget to bring that into balance.
The board unanimously approved reductions of more than $13.3 million, eliminating 73 full-time staff positions out of about 1,400, including 26 in the central office, 29 from school building administrations and 18 teachers, although no teacher layoffs were planned. Lindsay-Ryan tipped her cap to the “real people who have served our district well” and who “will not be here anymore,” and said the decision was “nothing to celebrate.”
During a forum in January, Hernandez, an audience member, said that previous boards hadn’t regularly conducted student assignments or analyzed operational capacity, and he referred back to the 2017 referendum as having been “just a Band-Aid. We’ve operated in a way that has just not been efficient, and here we are.”
A report from Grossi earlier this month was considerably sunnier than in the past, showing that the district has operated at a $3.6 million surplus for the current fiscal year to date, compared to the $9.3 million deficit it had racked up at the same point in the last fiscal year.
While celebrating this progress, Grossi cautioned that the district’s reserves to address major capital needs had been sapped, and that all districts will face headwinds like lower inflation — meaning less tax revenue growth — along with a reduction in corporate personal property taxes and the uncertainty of federal funding under the Trump administration.
“The first major fire that had to be put out was to get rid of the structural deficit,” Grossi said. “The district had to stop the bleeding as much as possible. And the district has come very close to stopping the bleeding for this point in time. The challenges that you still face are that your fund balances are now low.”
Other challenges remain as voters begin to cast their ballots in the 2025 school board race, in which none of the four incumbents — Lindsay-Ryan, Su, Kim and Hailpern — is running for reelection, and 12 new candidates are vying to replace them, down from an initial field of 17.
Among the fiscally relevant decisions awaiting the newly reconstituted board will be whether to close additional school(s) beyond Bessie Rhodes — and if so, which one(s) — along with how to invest in desperately needed maintenance for existing buildings.
From a referendum to budget deficits: How District 65 got here is from Evanston RoundTable, Evanston's most trusted source for unbiased, in-depth journalism.